The Abominable No Man Strikes Again

Charlie Munger is famous for his belief that he isn't entitled to hold an opinion unless (I should probably write 'until'!) he can state the arguments against his position better than those who oppose it. "I think that I am qualified to speak only when I've reached that state," he has said.

Charlie Munger & Warren Buffett.

He means it. Warren Buffett and Munger--who has earned Buffett's nickname for his 'the abominable no man'--are so serious about getting dissenting opinions and outlooks that they invited a guy to join them because he disagrees with them.

Berkshire 'Bear' Doug Kass.

This isn't a first. Concerned that the annual Berkshire Hathaway shareholder meetings were becoming too friendly and the questions raised were becoming more laudatory than interesting, reporters were invited to spice things up.

Munger is fond of rehearsing Richard Feynman's line, "the easiest person to fool is yourself." And for good reason. We don't all have the ability to invite our harshest critics over for a sit down. I wonder, though, how many of us take advantage of the chances we do have to hear, consider, and learn from conflicting points of view.

John Stuart Mill argued that no opinion--no matter how repulsive--should be suppressed by society.  And he didn't argue for such a position based on first-amendment grounds (he was British, after all). Instead, like the utilitarian he was, Mill advocated for allowing all opinions because doing so would lead to a healthier, more robust society.

J.S. Mill: Getting different opinions is good for you.

Among the reasons he provided for this position was that voicing an incorrect opinion strengthens a correct opinion because it allows for a healthy contestation of ideas. It goes without saying that the ideas that emerge after a vigorous debate are likely to be stronger than those who carry the day unopposed.

"The peculiar evil of silencing the expression of an opinion is, that it is robbing the human race; posterity as well as the existing generation; those who dissent from the opinion, still more than those who hold it," Mill wrote in On Liberty. And here's why, "If the opinion is right, they are deprived of the opportunity of exchanging error for truth: if wrong, they lose, what is almost as great a benefit, the clearer perception and livelier impression of truth, produced by its collision with error."

It's no coincidence that the most famous writer on liberty is a guy so careful not to trample on people's opinions. Charlie Munger is hardly bashful about letting people know they're wrong. But his example in inviting the strongest critics he can find is instructive. It means that the he lives by the creed J.S. Mill recommended for society.

The thing we can take from this, to my mind, is what a good idea it is to go out of our way to expose ourselves to ideas that differ from our own. what better way, after all, too destroy your best ideas? How often do we seek out not only someone with a differing view, but someone who passionately, ardently disagrees? But how beneficial would such a practice be?

Here's Mill again discussing the effects that strongly held beliefs carry more weight in the contest of ideas:

"He who knows only his own side of the case knows little of that. His reasons may be good, and no one may have been able to refute them. But if he is equally unable to refute the reasons on the opposite side, if he does not so much as know what they are, he has no ground for preferring either opinion... Nor is it enough that he should hear the opinions of adversaries from his own teachers, presented as they state them, and accompanied by what they offer as refutations. He must be able to hear them from persons who actually believe them...he must know them in their most plausible and persuasive form." 

Those sentiments could have been written by Munger. The two thinkers share a diagnosis for the disease of uncontested opinion and the likely outcome. Mill's dad James made the arguement that no one knows how a man's shoe fits better than himself. And so he was rightly skeptical about people telling other people how to think or act. And J.S. was pretty sympathetic to that position. But it was possible for the latter to ignore what a person (or porcine) thinks. And failing to buttress one's opinion with the dissenting viewpoints of others was a good way to warrant such disdain:  "It is better to be a human being dissatisfied than a pig satisfied; better to be Socrates dissatisfied than a fool satisfied. And if the fool, or the pig, are of a different opinion, it is because they only know their own side of the question.

But being a fool or a pig might be preferable to Munger's take on what not subjecting your ideas to real challenges makes a person: a one-legged man in an ass-kicking competition.

Listen to Charlie: Televised Interview May 6

Listen to Charlie

This blog is founded on the idea of learning from Charlie Munger & Greg Glassman. One of the best ways to learn from Charlie Munger is to listen to him when he talks.

And he’ll be talking in a televised interview on Monday, May 6. He won’t be the only guy on stage (in fact he won’t be among only guys—Berkshire’s newest board member Meryl Witmer will be among those interviewed). And his fellow interviewees will probably talk a lot more than Charlie. Fortunately, Warren Buffett, Bill Gates, and Meryl Witmer will also offer compelling insights over the course of the 50-minute interview. Berkshire Hathaway CEO Warren Buffett, Berkshire Hathaway Vice Chairman Charles Munger, Microsoft Chairman Bill Gates and the newest addition to the Berkshire Hathaway board Meryl Witmer after the company’s shareholder meeting.

Meryl Witmer: Berkshire Hathaway's newest board member

Business school students from Georgetown, Wake Forest, and Columbia will get to ask questions. So if you can’t make it to Omaha this weekend, or if you do but any of your burning questions for Charlie & the gang go unanswered, float a question or two to your closest B-school friend from any of those institutions.

The interview will be broadcast live on Monday, May 6th at 9:30 a.m. Eastern time on Fox Business Network. 

Need Berkshire Updates? 

Warren Buffett is on Twitter. But Reuters editor of U.S. investment strategy Jennifer Ablan will be a lot more helpful. She’s in Omaha & tweeting updates from the weekends proceedings. Follow her: @jennablan.

Jennifer Ablan on Twitter

  Quick Munger update: not trying to 'out-Apple Apple.'

Women & Business: Buffett, Witmer, Berkshire’s Board, & more

With Berkshire’s appointment of Meryl Witmer, a principal at Eagle Capital Partners, much is being made about the company’s stance toward women. She is the third woman to be appointed to Berkshire's board; three of the past five Berkshire board appointees have been women. Still, a recent Calvert Investments report lists Berkshire as the worst company for diversity in the country. And one of the report’s co-authors, Christine De Groot, Calvert associate sustainability analyst, said that, “there’s no evidence that diversity is a priority for [Berkshire Hathaway] at all. In fact, the company takes an active stance against diversity in the board room.”

Buffett has also argued that diversity on Berkshire’s board lagged because he basically made all the decisions himself and didn’t rely much on the board for help.

Warren Buffett not only joined twitter (Munger won't be joining him--not his milleu), but he also just authored a piece for Fortune magazine on women in business that speaks to the topic of diversity.

It’s an interesting piece. Especially given Buffett’s belief that diversity shouldn’t be a consideration. He cites Washington Post magnate Katherine Graham as a paradigm case of the way women had the deck stacked against them for years. “I met Kay in 1973 and quickly saw that she was a person of unusual ability and character. But the gender-related self-doubt was certainly there too. Her brain knew better, but she could never quite still the voice inside her that said, ‘Men know more about running a business than you ever will.’”

And then he makes the same utilitarian argument for women’s full inclusion that John Stuart Mill advanced in “The Subjugation of Women” in 1869. “The legal subordination of one sex to another — is wrong in itself, and now one of the chief hindrances to human improvement,” Mill wrote. “And that it ought to be replaced by a system of perfect equality, admitting no power and privilege on the one side, nor disability on the other." 

Utilitarian John Stuart Mill.

Buffett’s case for equality is remarkably utilitarian—every bit as utilitarian as J.S. Mill’s was. “No manager operates his or her plants at 80% efficiency when steps could be taken that would increase output. And no CEO wants male employees to be underutilized when improved training or working conditions would boost productivity. So take it one step further: If obvious benefits flow from helping the male component of the workforce achieve its potential, why in the world wouldn't you want to include its counterpart?...The closer that America comes to fully employing the talents of all its citizens, the greater its output of goods and services will be. We've seen what can be accomplished when we use 50% of our human capacity. If you visualize what 100% can do, you'll join me as an unbridled optimist about America's future.”

And, interestingly, the Calvert investments report lists Coca-Cola among the best companies. Buffett is, famously, Coca-Cola’s largest shareholder. He recently made an appearance at the company's annual meeting:



It’s not a coincidence that a company Buffett owns a lot of stock in has such a record. According to Buffett, Berkshire doesn’t have a corporate diversity policy because he doesn’t dictate one to the company managers. “They do run their own businesses.”

Is that good enough?